Venezuela and China have agreed on the terms of a previously announced $4 billion financing deal to increase the output of their Sinovensa joint venture in Venezuela's Orinoco oil belt, the South American country's oil minister said late Wednesday.
"We have agreed on the financing that was under discussion, but now the agreement is ready, that is the big news," minister Rafael Ramirez said while touring some of the joint venture facilities under construction in the Carabobo oil field, according to a statement from the ministry.
China will be providing the $4 billion loan on top of its current commitments in the joint venture.
China's Vice President Li Yuanchao was part of a delegation touring the facilities with Ramirez. Li signed four general cooperation agreements with Venezuelan officials Tuesday in Caracas and is meeting with Venezuela's President Nicolas Maduro.
Ramirez said he will announce details of the financing agreement soon, and plans to visit China to sign the deal.
Li discussed in general terms that China could increase its investments in other blocks in the Orinoco.
"We think that with these agreements we can reach output of 40 million mt of extra-heavy crude per year," he said. That's roughly 723,000 b/d using a conversion factor of 6.6 barrels per metric ton.
Sinovensa operates in a field with oil reserves of some 47 million barrels, or 16% of the total 297 million barrels of proved reserves in the Orinoco.
Current production is at 140,000 b/d from that JV, Ramirez said.